The U.S. Supreme Court today ordered a stay of a nationwide injunction preventing enforcement of the Corporate Transparency Act and its requirement for businesses to report their beneficial ownership information to the Financial Crimes Enforcement Network.
In late December, the Fifth Circuit Court of Appeals lifted a nationwide injunction issued by a district court judge in a Texas lawsuit challenging the CTA, which requires covered businesses to report their BOI to FinCEN. However, three days later, “in order to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments,” the panel of Fifth Circuit judges that will consider the merits of the government’s appeal of the preliminary injunction vacated that decision and once again enjoined enforcement of the reporting rule and CTA, putting the reporting requirement on hold once again. The Justice Department appealed to the Supreme Court for a stay of Fifth Circuit injunction.
The Supreme Court’s stay allows the CTA to be enforced while the courts weigh the merits of the case. As of Thursday afternoon, FinCEN had not provided instructions about the resumption of BOI reporting.